Give Me Liberty and Give Me Stress

In the United States of America, we enjoy our freedoms. We are free to choose to walk around wearing darn near anything we want (which certainly can cause some to cringe) and we speak out against the government as much as we darn well please.

No, this is not another column about the NCUA.

We like to think that as long as we aren't impinging on others’ rights or they on ours, everything is peachy keen because we have more choices available to us than darn near anywhere else or at any other time in history. And generally free markets afford those of us fortunate enough to live here the opportunity to choose between various providers of goods and services, and even between the various goods and services those providers provide.

During the economic crisis and now, consumers have been wooed to financial institutions with lots of options. The question becomes, how much freedom is too much. The goal of marketing is to meet consumers’ needs and wants and the last thing a credit union marketer wants to do is to cause members and potential members confusion. That is why marketers learn persuasive ways of communicating messages in a clear manner to draw consumers in. Offering too many choices creates uncertainty and confusion for consumers, which can be bad all around. Finding the right balance is key.

Search YouTube for Barry Schwartz on The Paradox of Choice. Schwartz explains that in order to maximize the welfare of citizens one must maximize individual freedom, which means maximizing choice. As an example he cites modern cell phones that perform far more functions than most consumers could ever use. My husband and I just bought a so-called smart television. I know I will never figure out what all of the buttons on the remote do.

Schwartz, however, points out that all of these options that are thrown at consumers generate negative results. First, consumers can experience paralysis because the choice is too complicated and it is tempting to put it off until tomorrow and tomorrow's tomorrow. Retirement savings and investment plans are an excellent example of this, and for many working people it's a ways down the road. Personally, I feel like I’ll be working forever so I’ll have plenty of time to worry about it.

Even when consumers make a decision, they end up feeling less satisfied with the decision they made. They can easily imagine that they could have made a better choice, even though none were necessarily bad choices.

Choice has spoiled us. We as consumers hold products and services to a higher level of expectation, which means it is eminently more difficult to pleasantly surprise your members.

Using surveys, focus groups, demographics and psychographics – and experience with members – marketers should be able to hone in on what consumers are likely to do next, particularly existing members. Net Promoter is one way to measure loyalty of existing members and how likely they would be to refer the company to someone they know. Credit union marketers can dig deeper though, such as whether members actually have referred an acquaintance or family member. They can also easily see if the members have expanded their use of the credit unions’ services.

Equipping marketers with comprehensive tools and employing all of this information can help them to determine what options and products are in demand from members or will be soon. By narrowing it down for members and using targeted marketing, credit unions can become more efficient and effective with their product offerings.

Yes, it is a marketer's job to identify and meet member needs and wants, but not necessarily every single need and want of every single member. Attempting to be all things to all people strains resources and even can be counterproductive by placing undue stress on members and potential members.

Consumers face so many decisions today that just walking down the toothpaste aisle at the grocery store can be stressful, and forget about the cereal aisle: There is every type imaginable from high-fiber to low-fat to gluten-free to sugary cereals marketed to kids that harried mothers give in to. Financial matters in particular can be stressful and overwhelming. Credit unions would do well to simplify banking for their members by respecting the power of marketing and equipping their departments appropriately.